Kurt,
I agree with both companies that are also having this issue.  I, as well, have spent numerous hours on the phone with QBO Time, QBO Payroll and QBOnline.  Time tells me it is a payroll issue, Payroll tells me it is a time issue.  QBOnline tells be to talk to both.  I switched over to QBO because of the hourly cost -> Project feature.  Not only does the feature not work, it only post payroll direct time to the project no matter if it is OT, or Regular time.  I do not have the time to go back and manually input each employees correct hourly cost for every day for every project.  This was the feature that sold me this software and yes, I have contacted everyone, even R & D but have not received any answers or assistance, just a lot of transfers or hang ups.  It is a lot frustrating.  It would be very beneficial if someone on the support/sales team would take the initiative to get this feature working correctly.